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10/16/2005

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andrew

"If America does not accept greatly increased numbers of highly skilled professionals, they might go elsewhere-Canada and Australia, to take two examples, are actively recruiting IT professionals."

Obviously, although even Hong Kong and Japan have created special visas to ease the immigration of carefully screened I.T. immigrants. In fact in South Korea I'd venture to say the only immigrants are either e-2 teachers or e-7 high-tech workers. What is the process of naturalization in the U.S. anyway? In Japan it's actually not as hard one might think, it requires 10 years residence with over 3 million yen a year in revenue, additionally there are self sponsoring visas that enterprising entreunpenuers or established freelancers can use to pay their own way along with "working holiday" visas for college students from Australia, England, basically all the english speaking countries except the u.s.

peace,
A

Bernard Yomtov

I agree wholeheartedly with Becker. We should be making it easy, not hard, for skilled, productive individuals to become Americans.

Steve Sailer

If Dr. Becker and Judge Posner favor taking lots more skilled immigrants, doesn't their logic also imply that the U.S. should be taking lots fewer _unskilled_ immigrants?

M Webb

Steve:

To me it does not seem that Prof Becker and Judge Posner's arugment necessarily implies taking fewer unskilled immigrants. However, I would suggest that low skilled immigrants are more likely to impose costs on the system (e.g. healthcare welfare etc). That said, most studies I ahve seen indicate that even low skilled immigrants generate far more benefit for society then they impose in costs. However, the benefit may be diffuse (i.e. the whole state or whol country) whereas the cost may be concentrated (the charity hospital in LA county). This provides a strong argument for dealing with the issue at a Federal level.

Diffuse benefits and concentrated costs also in my mind answer the question Judge Posner asks of why there is opposition to increasing skilled immigration. The benefits accrue to society as a whole. The costs are borne by a relatively small subset of high skilled workers who have an incentive to be vocal.

Finally, on security it seems to me that liberalizing immmigration policy could enahnce our security. The logic works as follows. Assume that the US has a legitimate interest in keeping out:
1) People with communicable diseases
2) Criminals and Terrorists
3) Lazy Folks who don't work

Therefore, when someone applies for a visa you reqire them to provide some medical documents some police documents and promise to be employed for X number of years. After they come, if the documents turn out to tbe false, they commit a crime or they go on welfare (and perhaps some other things) then they are deported. In this way people who want to come here for legitimate reasons (i.e. to work pay taxes make a better life for themselves) can do so. Those who have illegitimate reasons (i.e. they want to commit crimes or be terrorists) will be forced to continue using illegal means. However, since the INS will not be spending so many resources trying to catch folks coming for legitimate reasons they can concentrate their resources on catching the folks coming for illegitimate reasons.

Friedrich Berg

Knowing about the implicance that a big Epidemic event such as the one so many advise as possible, bye the N5H1 virus in the world. Which would be the cost and the economic effects of such (a possible) "global infection"? (noticing that many would pass away). What measures could be taken in terms of social security?

Best Regards.

Arun Khanna

Immigration reforms along the lines proposed by Professor Becker will help social security solvency. By encouraging skilled workers from non-terrorim prone Islamic countries, U.S. will get workers who contribute more to social security monies (and annual tax revenues) then they are projected to take out from the social security fund. These immigrants are also likely to assimilate faster in mainstream society.
I disagree with Professor Becker's sale of rights to immigrate proposal for two reasons. First, there is a wedge between the value of individual immigrant to the host country i.e. U.S and value of immigration to the individual immigrant. Second, sale of rights to immigrate ignores financial constraints faced by individual immigrants.

garygech

One of the key issues in evaluating a complex set of laws is to understand not only the policy implications but the tension on various elements.

My direct experience in working in Silicon Valley as a physician is that Mexican workers are very hard working and decent people. They are very similar to other workers with more education.

The key to understanding immigration is more abstract than education. Education is a fair metric of immediate skill. But the deeper issue is the American dream.

A person has to believe in our country and be willing to give up part of their past heritage for a greater future. Individuals that accept the American bargain are very deserving of citizenship.

I am not sure that a person without allegiance to our country should obtain citizenship easily. For instance, I am more comfortable that someone served in our military defending our country than someone attended the University of Chicago. This is not because the University Chicago is lacking, but simply because their role is different in our society.

Fundamentally, the University of Chicago is a private institution. The U.S. military is a public institution and is specifically mentioned in our Constitution.

Because our citizenship is dual, the federal component is so critical. A person must have federal allegiance in our system of laws. Many people argue that a person must also be committed to our culture. I have heard this from many highly conservative people and surprisingly from some liberals.

My brother who was at Yale School of Management believes that immigration is critical to maintaining our social security program's liquidity. He has aptly pointed out the European problem of going 1 to 1 (one worker for one retiree).

I use this 1 to 1 analogy from my experience of cardiology at Ohio State. A person was 1 to 1 when the heart beat once with each balloon pump cycle. As we weaned people off the pump, they went 2 to 1, 3 to 1 etc, etc. When social security was constructed, it was probably about 15 to 1. Now we are down to about 2.5 to 1 depending on how you count.

You see, I am not particularly Malthusian and never have been. I have learned that the economics of the body are not that much different than a nation.

Essentially, an economy is healthy or it is not. There are many reasons, and many moving parts.

The idea of immigration into the political and economic body of this nation is much like a transfusion. More important than how much you transfuse is if the blood is well matched.

Consistently, the United States has taken people from other countries who have been rejected socially and politically. What made these people well matched was their willingness to adapt. I don't think there is an easy metric of adaption. But I do believe that adaption is palpable, somewhat like a pulse.

When you arrive upon a person wanting a better life, desiring to contribute to our country, you've got the right talent to become American. The issue of being a great American isn't simply how smart you are. Take Ronald Reagan versus either President Bush. Ronald Reagan never had the opportunity to attend an Ivy League School. Both the former President Bush and the current President Bush did. I would venture to guess that Ronald Reagan was not as good at standardized testing.

But that really does not matter in my opinion, for the quite simple reason that Reagan was sincere. Reagan really believed in the American spirit. This spirit transcends any single industry and is what binds us. Reagan was able to convey this to the American people in a way that touched many Americans.

Now, when we look at the specific laws of immigration, we find they are very convoluted. There are many steps to achieve citizenship and many exceptions. It is not so easy to take a guess at how the law should be constructed. Naturally, most people want to talk about global policy and not about procedure.

The real issues remains in immigration the nature of the burden. Should the immigrant bear the burden of proving value, or should the government carry a burden of disproving value? Obviously, every person who applies for citizenship feels they are valuable, but inevitably, the blind watchman of the administrative state must make a decision. Occasionally, an immigration judge intervenes.

I had a beautiful girlfriend in Savannah who was from Bolivia. She immigrated to this country and it took a long time. She was very sweet and very kind. She also taught tennis professionally and looked great doing this.

She changed my mind about immigration. Personally, I think we need to let more beautiful women into the country. Look at Bill Clinton, he had to settle for Monica Lewinsky and then pardon Marc Rich.

Clinton essentially had his political rights of Marberry v. Madison mixed up. What he should have done was pardoned all the beautiful women he could find that were being extradited during his administration. This was well within his political right as the President. Then, he should have forgotten about his personal body and focused on the future of body of this nation.

With more thin beautiful women, especially from foreign lands, we would be more likely to win the Ms. Universe contest. This could in fact reinvigorate television and possibly even save Atlantic City from Paris Hilton.

But instead, we all know the vapid ending.

As a final note, the President under our Constitution does have the right to affirm treaties. If the Congress would finally pass the A.W.F.T. (Athletic Women First Treaty), I am sure President Clinton would have signed it. The question remains Putin - Would Putin have put all of the beautiful women of Russia at risk of becoming American?

Now you may laugh at my comments, but it is all about competition. We have an epidemic of obesity in this country and the only thing that is going to halt it is good old competition. Let some young thin women through Ellis Island again and people are going to start exercising. The men are going to be chasing these new immigrants, and the women are going to get jealous. Soon diets will change and our way of life will improve.

Now if you only let smart people in, I can tell you what is going to happen. One day, the nation is going to find itself in a legitimate war. Smart people, being smart, try to avoid going to war. So in the end, we may become a nation of smart people without national pride or spirit.

Sure, you can deny it, but if you look in the University of Chicago parking lot, I bet you don't see many American flags on the bumper.

Now, back in Savannah, alot of folks had pick up trucks, but not many had gun racks. They all took pride in the American flag even if they did not graduate from college.

So in the end, nationalism is a little different than scholastic ability. In an ideal world, I would like to see both. But the Constitution I read seems to suggest, especially in the Preamble, that the defining issue is allegiance to our Constitutional principles, not an allegiance to our industry.

As far as the Constitution is concerned, it should be body blind. Whether you are part of a smart student body or part of a fit student body, productivity is not the defining issue.

Rather, citizenship, as part of the civil war compromise is defined by the 14th amendment. The key to this is understanding that even if your parents are here illegally, if your body is born in our country, that makes you a citizen. Next, after that, are the people who apply for citizenship.

I guess I should end this little essay on the clasical argument in law over the is and the ought. It ought to be that Americans have a logical, rational, and consistent immigration policy. But in California, it is a fact, that the average farm in the central valley depends on migrant workers and simply breaks the law. Now Stigler's capture theory is applicable. You see, you would think the farmers would want liberal laws, but just the opposite. They have captured the government which passed a law making it just about illegal for a Californian to bend over and pick up a weed (low back pain being a leading cause of disability). Now, we depend on migrant immigrants to pick apricots and avocados, oranges and olives.

Of course Cisco and Oracle has a team of lawyers that facilitate their international workers getting in. But truth be told, at the end of the roaring 1990's the dot.com boom went bust and the Republican Congress has a new tune of security.

That's why the Athletic Women First Treaty was so important. Sure people rallied around the Nuclear Test Ban treaty but it made absolutely no difference until Reagan's idea of SDI finally bankrupted the Soviet Union. Back in the day, if you were a Russian physicist you got an immediate green card and a fast track to Alabama.

But soon enough, there was an over supply of rocket scientists. Those are just the plain facts anyone who lived through it would have remembered. The old street myth of a person graduating in physics and driving a cab in NY was a good one.

That is why we have to think through this immigration problem long term. More beautiful women means better looking future generations.

Fourteenth Amendment

Section. 1. All persons born or naturalized in the United States and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

Dobeln

It is most likely true that brain-draining the rest of the world is good for the US economy. That, however, still leaves, at the very least, two large questions unanswered:

1.) Is it good for the sending country? (Prof. Becker does address this, but in a rather passing manner)

and:

2.) Is it good for US society?

With regards to question number one, prof. Becker mentions remittances and returning up-skilled workers.

Still, are really mana-from-above infusions of foreign exchange the best path to developing a third world economy? Remittances bear a significant resemblance to good ol' Balance-of-payments support - a flavor of international aid with a decidedly mixed record.

As for question number two, importing a high-powered cognitive elite by the millions from foreign countries is likely to have interesting effects on all those boring social stability variables that don't show up in GDP statistics. This is especially true if you simultaneously import a new underclass by the millions, to perform menial tasks for the (increasingly imported) overclass.

dobeln

Short aside: The look in the preview and the actual published look of comments seem to differ quite a bit. (I didn't expect those *huge* spaces ;) )

Enslow

Regarding your first question...I think that the U.S. has a better technological infrastructure to foster highly skilled workers from other countries, which will lead to better and more technological innovations than those that could be produced elsewhere. Since the U.S. is the economic engine of the world, these advances will eventually trickle down to the countries who send their workers here and help them grow as well. So, I do think think the sending country will reap the rewards of having their highly skilled workers in the U.S., at least in the long run.

N. Linssen

I was surprised to read that Judge Posner is "puzzled by the political opposition to increasing the quotas for highly skilled immigrants." Perhaps he has spent too much time in the so-called judicial monastery. The reason seems clear enough to "Dobeln," who alludes to the obvious reason for opposing this policy--namely, that it amounts to importing a "cognitive elite." Dr. Becker suggests the other obvious reason, which is that admitting large numbers of highly skilled workers will put downward pressure on the wages of the American workers they compete against.

But Dr. Becker's response to this issue is as galling as Judge Posner's. He asks "But doesn't the US benefit if, for example, India spends a lot on its highly esteemed Institutes of Technology to train many scientists and engineers who leave to work in America?" I believe the likely answer is "who cares?" This policy presents a serious individual vs. collective problem, and Americans are not known to be terribly interested in the collective.

Consider the perspective of Joe Sixpack, whose earnings have been depressed by a preponderance of low-skilled (and frequently illegal) workers from Mexico and elsewhere. He might be thinking about ways to increase his earnings--say, by going back to school, maybe pursuing an engineering degree. You want to tell him that he will be forced to compete with a vast and well-educated pool of workers from India and China (many if not most of whom will have the built-in advantage of being bi- or multilingual)? For wages that are certain to decline? And at the same time that tuition is increasing faster than both wages and inflation?

If wages are being squeezed from above as well as below, it will presumably not be long before people begin to realize that economic mobility is decreasing, and that those Horatio Alger stories just aren't being written anymore. And let's not forget that throughout most of US history, immigrants to this country have been drawn from the lower echelons of their native countries.(Remember those "poor, huddled masses" Emma Lazarus described in a poem that is inscribed on the Statute of Liberty?) This might be another reason for the resistance to immigrants forming a "cognitive elite."

One final thought: if employers in the US are to be granted access to an unlimited stream of well-educated immigrants, what incentive will there be for government and private industry to invest in education of future American workers? Our education system is already in decline--and isn't this a primary reason for considering this policy in the first place?

A. Zarkov

Both Becker and Posner display an appalling ignorance of the non-immigrant visa program and the disastrous affect it has had on the welfare American technical professionals. The majority of H1-B immigrants are not ÔøΩhighly skilled.ÔøΩ To qualify for the program you need only hold a BachelorÔøΩs degree. Moreover there is nothing ÔøΩhighly esteemedÔøΩ (by American standards) about the Indian Institute of Technology. H1-B holders displace higher paid Americans decreasing not increasing tax revenues. H1-B immigrants canÔøΩt change jobs with resetting the waiting time for a green card, so they are captive to their employers who enjoy cheaper and more docile employees. ItÔøΩs particularly disappointing to see Becker repeat the canard that ÔøΩOver one-quarter of the entrepreneurs and higher--evel employees in Silicon Valley were born overseas.ÔøΩ Norm Matloff, professor of computer science at UC Davis has debunked this idea, and I recommend they read his article in the University of Michigan Journal of Law Reform Vol 36:4. This article covers the other issues as well. One needs to remember that the H1-B program was based on a non-existent shortage of American technical workers. There never was a shortage even in the late 1990s. The IT industry wanted a source of cheap labor and Congress gave to them. Moreover, the US government continues to ignore rampant age discrimination through out American industry with regard
scientists, engineers and IT professionals.

The Dude

At the very least, every foreign student graduating with an advanced degree from an American university, especially in the sciences, should get a green card stapled to their diploma. That should be easier for Congress to pass.

FN

I think only allowing in highly-skilled immigrants into the United States will be against the American spirit of democracy and fairness. The US has always been the place for the poor and disadvantaged from other parts of the world to go to improve their lives.

Also, I think you underestimate the impact of brain drain for developing countries that don't have much of it in the first place. In many cases a loss of skills is a whole lot more than the remittances sent back. In fields like education, healthcare, engineering it is hard to see how remittances can fully replace the services of doctors, nurses, teachers, research scientists and engineers. In many countries in Africa, the brain drain during the late 80s and 90s has reversed many social gains that were made in the decades prior. The quality of instruction, primary care services fell drastically because of the gaping hole left by the emigration of the skilled classes.

I think in terms of both skills and unskilled-based immigration, the quota system would work better if it was decided by the private sector rather than being a number arbritrarily picked by the govt. Having a more flexible guest-worker style program as Pres Bush has suggested would reduce the demand for permanent immigration amongst those immigrants who look at the US as a place to earn income and not necessarily to live permanently. It would allow both the US and the sending countries the opportunity to benefit from the exchange of skills and income.

FN

I think only allowing in highly-skilled immigrants into the United States will be against the American spirit of democracy and fairness. The US has always been the place for the poor and disadvantaged from other parts of the world to go to improve their lives.

Also, I think you underestimate the impact of brain drain for developing countries that don't have much of it in the first place. In many cases a loss of skills is a whole lot more than the remittances sent back. In fields like education, healthcare, engineering it is hard to see how remittances can fully replace the services of doctors, nurses, teachers, research scientists and engineers. In many countries in Africa, the brain drain during the late 80s and 90s has reversed many social gains that were made in the decades prior. The quality of instruction, primary care services fell drastically because of the gaping hole left by the emigration of the skilled classes.

I think in terms of both skills and unskilled-based immigration, the quota system would work better if it was decided by the private sector rather than being a number arbritrarily picked by the govt. Having a more flexible guest-worker style program as Pres Bush has suggested would reduce the demand for permanent immigration amongst those immigrants who look at the US as a place to earn income and not necessarily to live permanently. It would allow both the US and the sending countries the opportunity to benefit from the exchange of skills and income.

Rob

When government policies allow student visas, but not working visas, graduate student wages will undoubtedly be low as they are at every university in America. This will have two effects: Americans will pursue other opportunities outside of graduate work, and "marginal" foreign students will pursue graduate degrees when they may be better served pursuing full-time employment, but they donít have that opportunity.

In a 2002 Business Week article Dr. Robert J. Barro took a tongue-in-cheek poll of his fellow economists at Harvard and concluded that the NCAA was the ìbest little monopoly in Americaî because of the NCAAís ability to ìmaintain the moral high groundî despite not paying their workers or athletes. While the NCAA is indeed impressive, Iím surprised that Dr. Barro didnít applaud his own department that, via government regulations that allow foreigners with student visas to work on campus as teaching assistants and carry an enormous amount of the teaching workload, the wages afforded these individuals are kept vastly beneath their marginal contribution. American universities benefit tremendously from an open immigration policy for student workers, and a closed immigration policy for all other workers. My vote for the best little monopoly in America: American graduate schools for their ability to import highly skilled and educated workers below cost.

Anonymous

the real wage is always determined by the mariginal product of labor and since the marginal product of labor for a graduate student is extremely low the real wage is low too; says the guy who has been in a graduate student for four years......

Rob

Real wages are determined by the marginal product of labor in a competitive labor market with a free movement of labor. This is not the situation that we observe in American graduate schools where foreign students are limited by the quotas in their opportunities to pursue work outside of school.

Jim S

There are so many appallingly incorrect things in the assumptions of both Becker and Posner that it isn't funny. It's not that they need highly skilled people that they can't find in the U.S. It's that there's no interest in training Americans that could gain those skills. When will there be honest articles here about the obstacles put in the way of Americans who might need additional training to get these new jobs? How long does it take to undergo the training required to land a skilled job? How long do unemployment benefits last? Do you see a bit of a disconnect?

For American middle class workers it's more expensive to keep them happy (I'm not thinking just of salary here.) than they want to spend so they just want to import replacements.

It seems that neither Becker or Posner ever want to really address the human cost of the practices of the corporate management they adore, generally giving it only the most cursory examination.

Corey

I'd like to see some real evidence that foreign-born, US educated H1-B workers are paid less.

Employers have to post the salaries they pay H1-B workers. Every one I saw during my career was making as much or more than me. There are some instances where companies get people over a barrel with threats of ending H1-B sponsorship, but that is only marginally worse than the threat an American feels at the prospect of a sudden layoff. My last layoff forced me to pick up and move to a different (cheaper) state. It was almost like being deported, only I left in a U-Haul not a plane.

If you are serious about going after corporate management, I would think the best strategy would be to express solidarity with the H1-B workers. Get a union going, include them in the grievances. First order of business, no firing people without cause. Management benefits from turning american workers against immigrant workers. It is a labor-busting technique as old as this country.

I agree that Americans should be trained for better jobs. That was what led me to borrow money from the government to attend graduate school. My unemployment checks ran out two months before my Stafford loan checks arrived. It was a bit tight there for a while but I didn't die.

When my father was age discriminated out of his Forestry job after 33 years, he was able to get government funding to obtain a second degree (Business) and is working again. The point is that there are some opportunities for Americans to get subsidized retraining. There should be more.

I don't believe born Americans should get special treatment in the American job marketplace. If we did the end result would probably be to make us all stupider by virtue of being sheltered. (Many people already think that is the case.)

Immigrants in the schools and in the workplace are not what is keeping Americans down. Capital is keeping a historically high percentage of the fruits of labor. Workers of the world unite.

monkyboy

Hehe, Corey, I think Marx would be pretty happy with the current state of workers in America. It's true that profits have gone up lately for the greedy capitalists, but workers are still earning about six times what the owners are.

Still, the higher profits could have gone to the workers. Foreign competition and immigrants do their part to keep U.S. wages down. And let's not forget technology playing its part, too. How many people read about this:

http://www.grandchallenge.org/

and thought that people who work as truck, bus and taxi drivers won't have jobs in a decade or so?

Getting a degree or even an advanced degree in a high-demand field is becoming more and more necessary to earn a good living in America. The days of stopping your education at high school and going into a job that pays well are over.

Let's get a million or so Chinese and Indian professors over here so every American can get a good degree at a reasonable price. It may cause the salaries of U.S. academics to plummet, but at least they will be able to retrain cheaply...

Anonymous

so that everyone understands:
there are three actions that a company can do with profits:
1.) distribute them to their shareholders in the form of a dividend
2.) retain them and invest them in the company for future growth.
3.) hand a portion of them over to gov't, b/c they are taxed.
NOTE: it doesn't include stuff the pockets of senior management.

also, for those that think unions are such a brilliant idea please see the american auto industry--unions are being weakened in this country and for good reason.

Anonymous

Becker wrote: ìTo be sure, the annual admission of a million or more highly skilled workers, such as engineers and scientists, would lower the earnings of American workers they compete against.î

There is more than one determinant of wage, so this is not a certainty as Becker is suggesting. There are substantial transaction costs associated with securing green cards that makes bargaining for wages heavily in favor of employers in these specific industries. Because employees lack mobility, they are ñ not dissimilar to baseball players under the reserve clause ñ stifled from securing higher wages. The market-clearing wage for all participants (American and foreign ñ Corey) is below what the equilibrium wage would be if labor mobility increased, and, therefore bargaining positions shifted.

Becker also writes: ìThe opposition from competing American workers is probably the main reason for the sharp restrictions on the number admitted.î

The opposition to increased quotas is not coming from American engineers and scientists because they intimately understand managementís stranglehold over foreign workers that stifles any increases in wages for the market as a whole.

My guess is that the opposition is coming from American universities who are able to dramatically decrease their expenses by importing college educated and bright teaching assistants who work for wages that an American 16 year old at McDonalds would laugh at.

albatross

Anonymous:

Maybe you've never heard of the principal-agent problem? The stockholders would certainly prefer not to have the senior managers stuff their pockets, but that doesn't mean it won't happen, since the senior managers are actually running things, and the stockholders just have occasional meetings, and have large transaction costs to work out what they want to do.

One of the more common ways for managers to stuff their pockets is to make decisions that make them look very good short-term (like outsourcing customer support, network management, etc.) because costs go down. When quality also goes down, customers find that they can't reach a human being with the power to fix their problem, etc., this costs the company a lot of money, but that doesn't show up as poor performance on the manager who originally made the decision. And if he got short-term incentives to make things look better, he may already have benefitted from those incentives and moved on to another company.

ben

Capital is keeping a historically high percentage of the fruits of labor

a) evidence please

b) theory of harm please

Thank you

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